Friday, March 30, 2012

Working Smarter: Is Yours a High End or Low End Market?

During my days as a police officer, I had one posting with a high exposure to the "massage" industry, which was of course a front for prostitution. Although I never used the service (that's the truth!), I often had discussions with madams (owners and managers of the businesses) and some of the girls who worked there. Occasionally, after the Vice Squad had been through the premises, I fingerprinted some of those arrested and processed them into custody.

At the time I was studying economics as part of a management course and so I was interested to know that there were women who had a high volume, low cost business model and others who had a high cost, low volume business model. What that meant was that those with high volumes and low cost, serviced many more clients per week and charged a lower fee. Typically, they were short, quick sessions where men went to ejaculate as soon as possible. Men who couldn't afford or didn't want to pay for more expensive prostitutes. Alternatively, the high cost, low volume women charged more, typically spent more time with a client, but didn't need to service as many clients for the same amount of weekly income as the high volume women.

What I noticed was that the high cost women were inevitably much more attractive, mostly younger and usually serviced men on better incomes and those who like a bit of foreplay and pandering.

By now, if you are still with me, you may be wondering what this has to do with your business model. The point is, you have to determine what market you are targeting and focus on it. If you are focusing on a specific market, you need to know that you have the capacity to attract it. For example, if you are selling low cost, bottom range air conditioning units, don't expect to be charging a premium cost and selling to well heeled housekeepers and large, multi-million businesses. People shop around these days ... you'd go out of business.

Some of the attractive women who followed the high cost, low volume model eventually slipped into the low cost, high volume model when they found that their clients dwindled as they aged. (Even prostitutes have a use by date!).

Do you know what your target market is and who are your customers? If you try to do all things for all people, unless you are selling something that everyone buys eg, pizzas, you could find that you are not earning as much income as possible. In fact, it's possible to choose two different markets that are mutually destructive ie, they work against each other.

Choose your market segment carefully and consolidate it before you try another market.


PS: As I've aged and become wiser (hopefully), I believe the low volume, high cost model of prostitution would be better if for no other reason than with less client exposure, it reduces the opportunity to catch sexually transmitted diseases and be assaulted by clients.

Helping You Improve Business Performance

1 comment:

  1. Next post I'll tell you about a marketing strategy that went terribly wrong when a business entrepreneur tried to mix two market segments.


Thanks for commenting. Comments with inappropriate content or spam will not be approved.